Forex Analysis: GBP/USD Continues Upside Push

June 30, 2014 – GBP/USD (daily chart) has continued its bullish momentum as it re-approaches its new five-year high of 1.7062 that was just established little more than a week ago. Not since late 2008 has this currency pair reached such lofty highs. Overall, since its low around 1.4800 in July of last year, GBP/USD has risen by more than 15% in less than a year, far outperforming its major currency pair counterparts.

The current highs above the key 1.7000 level were the result of a pronounced surge that occurred more than two weeks ago in mid-June that prompted a recovery from the pullback to 1.6700-area support. Now pushing higher above 1.7000, the currency pair could soon be poised to breakout towards a new long-term high.

If GBP/USD can maintain its strength above the key 1.7000 level, which is in the midst of potentially transforming into support rather than its previous role as resistance, a major upside resistance target resides around the 1.7250 resistance level. A failure to stay above 1.7000 could see the currency pair fall back towards the key 1.6700 support level.

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About Author

James Chen is Chief Technical Strategist for City Index Group. He is also a Chartered Market Technician. He is the author of the books: "Essentials of Foreign Exchange Trading" (John Wiley & Sons, 2009) and "Essentials of Technical Analysis for Financial Markets" (John Wiley & Sons, 2010). Mr. Chen writes currency analysis, leads forex trading seminars and has appeared in numerous major financial media outlets, including CNBC, Bloomberg TV, Forbes, Reuters, Dow Jones, and the Associated Press.

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